The financial sector includes several types of industries, including banking, wealth management, insurance and real estate. Firms in these industries serve both individual and commercial customers. As of Feb. 29. 2016, this sector included 89 stocks with a total market capitalization of over $2.8 trillion.
The banking industry includes companies that collect deposits and make loans to individuals and businesses. One good example is Wells Fargo & Co. (NYSE: WFC), which provides retail banking services to individuals. The bank also provides commercial and corporate banking services to businesses and institutions. As of March 14, 2016, its stock is trading at $49.62 per share.
Markets used to trade stocks, bonds and other securities are referred to as capital markets. New York-based BlackRock, Inc. (NYSE: BLK) operates in the capital markets industry. As of March 14, 2016, its stock is trading at $330.06 per share.
The company manages investment portfolios for mutual funds, pension plans and insurance companies. The firm manages 7,700 portfolios and has $4.6 trillion in assets under management (AUM). BlackRock manages funds for 94 companies in the Fortune 100 listing.
A consumer finance company, such as American Express Company (NYSE: AXP), lends money to individual consumers. This firm’s primary business is credit cards and providing services to merchants that accept credit cards. As of March 1, 2016, the company had 117 million credit cards outstanding.
This company’s financial performance is heavily impacted by the general economy. If economic conditions are worsening, customers may make late payments, and the company’s bad debt exposure may increase.
This stock’s price is closely correlated with the Standard & Poor's 500 index. As of March 14, 2016, its stock’s beta is 1.19. The stock is trading at $59.51 per share as of that same date.
Diversified Financial Services
Among the companies listed in the financial sector, Ameriprise Financial, Inc. (NYSE: AMP) may be one of the most diverse. Ameriprise is a diversified financial services company because it provides banking, insurance and capital markets services to customers.
The company’s asset management division offers investment management and advice. This firm also has an extensive list of insurance product offerings. Ameriprise provides both fixed and variable annuities, as well as life insurance and disability insurance. As of March 14, 2016, its stock is trading at $91.28 per share.
Large insurance companies, such as The Allstate Corporation (NYSE: ALL), provide tools that consumers use to manage risk. As of March 14, 2016, its stock is trading at $64.65 per share.
This firm focuses on car, home and other lines of insurance for individuals and small businesses. Allstate’s representatives also provide life insurance and retirement products and services. The company focuses on using cash for stock repurchases and dividends. As of March 14, 2016, the stock’s dividend yield is 2.01%.
Real estate investment trusts (REITS), such as AvalonBay Communities, Inc. (NYSE: AVB), are securities that invest in real estate. This company buys and develops multifamily communities and then operates the properties as an owner. As of March 14, 2016, the stock is trading at $182.54 per share.
AvalonBay’s primary source of income is apartment rental payments. The overall U.S. real estate market impacts the stock price of this REIT.
Real Estate Management & Development
Fee-based companies that manage property, such as CBRE Group, Inc. (NYSE: CBG), are assigned to the real estate management and development industry. This firm serves as an advisor to property owners and investors worldwide. The company also provides real estate valuation services, including appraisals.
Many institutional investors diversify their portfolios using real estate. This firm provides investment management services to institutional investors, endowments and foundations. CBRE also develops and invests in commercial real estate. As of March 14, 2016, the stock is trading at $28.03 per share.